Finding Text
Finding 2022-001 - Materially Misstated Schedule of Expenditures of Federal Awards Condition: Several adjustments were required to present the Schedule of Expenditures of Federal Awards prepared by Management fairly in all material respects in relation to the Organization?s financial statements. Criteria: Government Auditing Standards require adequate internal controls over financial reporting to ensure that financial statements and any required supplementary information is reported free of material misstatement. Additionally, Part 200. Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart F. Audit Requirements subgroup 47. Auditees Section 200.510, Financial statements: The auditee must prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with ?200.502 Basis for determining Federal awards expended. Context and Cause of Condition: Lack of or ineffective oversight by qualified individual(s), and deficiencies in the operation of existing accounting oversight procedures. Potential Effect: Lack of sufficient accounting oversight procedures will provide opportunities for errors or fraud to occur and increase the risk of material misstatement of the financial statements and required supplementary information. Additionally, lack of internal controls does not allow the preparation of the Schedule of Expenditure of Federal Awards to meet the requirements of Uniform Guidance. Questioned Costs: None Recommendation: We recommend Management establish procedures and controls to properly identify the funding source of all grant awards and the applicable Award Listing numbers. Management should track federal funds it receives and review the applicable compliance requirements to ensure proper grant spending, monitoring and reporting. The Schedule of Expend s should be reconciled to the Organization?s financial statements on a routine basis.